Contract Weasel Words

About the Role

This article explores the use and purpose of "weasel words" in legal documents, particularly in written contracts. These terms often serve important functions in defining performance, default, and reasonableness in contractual agreements.

Key Concepts

• "Substantial":

  Appears in performance sections of contracts. Contracts typically require "material" compliance rather than perfect performance. For example, delivering 9,994 out of 10,000 widgets may not constitute a default, as the shortage is not significant. However, precise performance may be required if explicitly stated in the contract, such as in agreements for close-tolerance machine parts.

• "Material":

  Commonly found in default sections of contracts. A default triggers remedies for the non-defaulting party, such as suspending performance or suing for damages. For instance, a minor shortfall in a loan payment (e.g., $0.18) would not be considered a "material" default, and repossession would not be justified on that basis.

• "Reasonable":

  A widely used term in legal documents, often tied to the standard of what a "reasonable person" would do. If a contract does not specify a timeline for performance, the law requires it to occur within a "reasonable" time. In real estate contracts, late performance may be excused if it is not unreasonably late, unless the contract specifies that "time is of the essence," in which case performance must occur by the exact date indicated.